The US Senate Passes a Tax Treaty with Chile

According to Mine.com, citing Reuters, on June 20th, the US Senate overwhelmingly passed a tax treaty with Chile, which is seen as crucial for US companies to obtain lithium necessary for electric vehicle batteries.

The Senate passed this treaty with 95 votes in favor and 2 against, far exceeding the two-thirds majority required to approve the treaty in a 100 member chamber.

The treaty will ultimately be submitted to the White House for approval, and it is said that President Biden plans to sign the treaty.

In 2015, the National Congress of Chile ratified the treaty. In 2012, the treaty was first submitted to the United States Senate, but it was not advanced, partly because Republican Senator Rand Paul opposed it. He was one of the voters who voted against it last Thursday, for fear that it would allow foreign tax authorities to obtain information about American citizens.

For many years, commercial interest groups have been pushing for this tax agreement. The United States Chamber of Commerce said that this is a top priority. Without this agreement, the tax rate of American enterprises operating in Chile may be as high as 44%.

American companies have a significant influence in Chile's mining, finance, and other industries.

Chuck Schumer, the Democratic majority leader of the Senate, said on Thursday when urging the passage of the bill, "As countries around the world compete to promote clean technology, Chile will become a key ally of anyone who hopes to lead in this regard.".

Schumer said, "If the United States really wants to stay ahead of countries like China, we must pass this treaty today.

In April, Chile announced a plan to expand lithium mining with the aim of regaining its position as the world's largest lithium producer.

Supporters of the agreement also stated that failure would hinder the United States' transition to clean energy.